Millions of stimulus payments that were erroneously sent by the IRS to closed bank accounts are being redirected and will be deposited into eligible recipients' accounts "in the coming days," the agency said Friday.
Earlier this week, some taxpayers who checked the status of their second stimulus payments on the IRS Get My Payment tool noticed that the funds had been deposited into bank accounts they did not recognize. The agency mistakenly deposited the payments into temporary bank accounts created when people filed their 2019 tax returns with tax prep companies like H&R Block and TurboTax, among others. An estimated 13 million taxpayers were affected, according to tax prep company Jackson Hewitt.
The companies soon notified taxpayers about the error and have been working with the IRS to fix the mistake so taxpayers can get their long-anticipated stimulus payments. TurboTax announced earlier Friday that millions of their customers should receive their payments soon.
The IRS said Friday that it is working to rectify the situation as quickly as possible.
"The information taxpayers see in the Get My Payment tool, including account numbers and potential deposit dates, may continue to display unfamiliar account numbers as the IRS continues to work through and update this issue," the agency said.
Some people will receive their second payment via the mail, either in the form of a paper check or a pre-paid debit card.
Still, others who do not receive a payment soon will need to claim a Recovery Rebate Credit on their 2020 tax return.
"Taxpayers in this situation are urged to file electronically with direct deposit to ensure their tax refund – and their stimulus payment – reach them as soon as possible," notes the IRS.
Thousands of taxpayers wrote into CNBC Make It this week to express their frustration at the stimulus check mishap.
"We are law-abiding Americans who followed instructions, submitted returns on time and properly, and not once has any communication from the IRS simply said, 'We are sorry,'" New Hampshire resident Chad Abel-Kops, 50, told CNBC Make It.
The agency says 100 million stimulus payments have been direct deposited so far.